Shanghai Air Pollution Wanes After Smog Forces Cancellations

People wearing masks walk along The Bund in Shanghai on Dec. 8, 2013. Source: ChinaFotoPress/Getty Images

Dec. 10 (Bloomberg) -- Shanghai’s air pollution fell to
“light” levels after record smog this month prompted flight
cancellations and the city warned children and elderly to stay
indoors on at least seven of December’s first nine days.

The city’s PM2.5 air pollution was 63.1 micrograms per
cubic meter as of 2 p.m., after hitting 360 micrograms per cubic
meter yesterday. Today’s reading is still more than two times
higher than the daily exposure level recommended by the World
Health Organization. The particles, which are smaller than 2.5
microns in diameter, are more dangerous than other particulate
matter, according to the World Health Organization.

“This is a shock,” said Robert Theleen, chief executive
officer of ChinaVest Ltd. and chairman of the American Chamber
of Commerce in Shanghai. “There was a perception that Shanghai
was doing a better job in controlling pollution than Beijing.”

Heavy pollution may undermine plans for Shanghai, the
nation’s commercial hub, to attract foreign investment and
multinational firms, as the city implements a free-trade zone as
part of a broader goal to become a global financial and
logistics center by 2020.

Production Cuts

The city’s air quality index was 130, categorized as
“lightly polluted,” according to the local monitoring center.
A warning to stay indoors is triggered any time the index
exceeds 200. The index surged to a record 482 on Dec. 6 to the
“severe” level, the highest of a six-tier rating system,
according to the China Daily newspaper. That prompted the
government to order cars off the road and factories to cut
production.

Baosteel Group Corp., the parent company of China’s
largest-listed steelmaker, is using low-sulfur coal in its
Shanghai power plants in line with government efforts to reduce
smog, spokesman Alex He said by text message today. The company
also suspended outdoor operations of its chemical facilities and
is controlling production at its iron-ore processing operations,
He said.

Premier Li Keqiang pledged in March to clean up pollution
including cutting coal consumption, shutting steel plants and
controlling the number of cars. Pollution has become the top
cause of social unrest in China, Chen Jiping, a former leading
member of the Communist Party’s Committee of Political and
Legislative Affairs, said that same month.

City Image

The smog is hurting the city’s image as it seeks to attract
foreign businesses and talent to its fledgling trade zone,
Theleen said. City officials need to do better job with
information disclosure and find out the root cause of the smog.
he said.

The pollution may be coming from coal power plants and
factories such as cement works in the provinces of Jiangsu,
Anhui and Shandong, Greenpeace China said on its website.

“Steps taken by the Shanghai government to alleviate
pollution aren’t enough,” Huang Wei, who works on climate and
energy issues for Greenpeace in Beijing, said by phone
yesterday. “Smog brings a huge health risk to the public and
definitely affects multinational companies’ investment decisions
and makes them hesitate before sending foreign employees to
China.”

Military Defense

In October, the Shanghai government announced a plan to cut
2012 PM2.5 readings by 20 percent by 2017. Outdoor air pollution
can cause lung cancer, the International Agency for Research on
Cancer, a WHO agency, said in October, ranking it as a
carcinogen for the first time.

The recent bout of smog could be beneficial to military
defense, the state-owned Global Times newspaper said in an
article yesterday. During the Kosovo war, the Yugoslavian army
used artificial haze by burning scrap tires to avoid bombing by
NATO, the Global Times said. In a reaction to criticism of the
article online, the editor of the Global Times, Hu Xijin, said
on his Weibo that it was wrong to interpret as a defense of
pollution. The party has interest in the topic, he wrote.

The city inaugurated in September its free-trade zone as a
testing ground for free-market policies including plans to
liberalize 19 industries from banking to shipping and allow
freer convertibility of the yuan.

“Longer term, if there is no response, of course it’s
going to have an impact on how Shanghai is perceived,” said
Theleen. “If Shanghai is going to be a financial center,
transparency is key.”